That of Elon Musk Neural link And Merge Labs backed by OpenAI are advancing brain-computer interface (BCI) technology in the United States. Meanwhile, Chinese serial entrepreneur Phoenix Peng is developing rival efforts through two startups: NeuroXess, which is developing implantable BCI systems, and a second company, Gestala, which is developing non-invasive ultrasound-based BCIs.
Gestala raised $21.6 million (150 million yen) just two months after its launch, at a valuation of $100 million to $200 million, founder and CEO Phoenix Peng told TechCrunch.
The round, co-led by Guosheng Capital and Dalton Venture with participation from Tsing Song Capital, Gobi Ventures, Fourier Intelligence, Liepin and Seas Capital, was significantly oversubscribed, with investor commitments totaling more than $58 million, Peng added.
This is the largest seed funding in BCI industry in China. Peng will use the money for R&D, expanding the team from 15 to about 35 employees by the end of the year and building a manufacturing plant in China. The three-month-old startup aims to complete its first-generation prototype by the end of the year.
The global BCI industry is currently experiencing a surge in investment in ultrasound technology. Gestala is the first ultrasound BCI company in China, but not the first in the world. Several BCI ultrasound startups have emerged in the United States in recent years, including Merge laboratorieswhich is among the largest.
Peng believes ultrasound could represent the next generation of brain-computer interface technology, offering the potential for broader access to the entire brain and new ways to interact with neural activity.
The founder says non-invasive ultrasound could tackle one of the biggest barriers to BCI adoption: the risks associated with brain surgery. Compared to implanted electrode systems, this technology allows monitoring of a larger part of the brain, including deep neural circuits. Using phased array ultrasound, the system can also precisely stimulate or suppress neuronal activity without requiring surgery, he explained.
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Despite rising geopolitical tensions, Peng still hopes that the United States and China can collaborate in in-depth technological research.
“The two countries bring different strengths,” Peng said. “China offers large-scale clinical research capacity and efficient supply chains, while the United States has world-class scientific talent. Joint efforts could also focus on creating large clinical datasets to support global neuroscience research, he mentioned.
The company is exploring several uses for its technology. On a medical level, chronic pain management is the startup’s flagship program. Chronic pain affects large populations in the United States and China, and existing academic studies suggest that ultrasound stimulation can significantly reduce pain levels, Peng said.
The startup is also exploring applications in mental health, including depression, PTSD, autism and OCD, as well as stroke rehabilitation. Other longer-term targets include Alzheimer’s disease, essential tremor and Parkinson’s disease. In total, the company is investigating six to eight potential indications, although most are still in early-stage research rather than clinical trials.
Gestala says its advantage over global competitors lies in speed and scale. By leveraging China’s integrated manufacturing ecosystem, the startup believes it can move from development to production faster than many international competitors.
The company is also working with major Chinese hospitals to accelerate clinical trials at significantly lower costs – about 20% to 33% of comparable studies conducted in the United States or Europe. At the same time, Gestala is building what it calls an “ultrasound brain bank,” a large clinical dataset designed to train AI models to decode brain signals and support future neurological diagnostics.
Kate Park is a reporter at TechCrunch, covering technology, startups and venture capital in Asia. She was previously a financial journalist at Mergermarket, covering mergers and acquisitions, private equity and venture capital.
